Pennsauken / NJ. (jj) J+J Snack Foods Corporation announced sales and earnings for the first quarter ended December 26, 2020. Sales decreased 15 percent to USD 241 million from USD 282.9 million in last year’s first quarter. Net earnings were USD 1.8 million in the current quarter down from USD 17.1 million last year. Earnings per diluted share was USD .09 for the first quarter down from USD .89 last year. Operating income decreased 97 percent to USD 578 thousand in the current quarter from USD 21.7 million last year. Operating income was impacted by approximately USD 730 thousand of Covid-19 related costs as we remain focused on the safety and protection of our associates. This year’s quarter benefited from a USD 420,000 tax benefit related to share based compensation contributing to an effective tax rate of 8 percent. We are estimating an effective tax rate of 25 percent for the full year 2021.
Our sales remain challenged by the lingering impacts of Covid-19 on both our consumers and our customers. Traffic in key food service venues that comprise 2/3 of our sales continue to operate at substantially reduced and limited capacity. This was especially pronounced during the Christmas holiday season where many of these venues rely on seasonally higher traffic and sales. Relative to our 2020 fourth quarter where sales were 19 percent below last year, we did see improvement in the 2021 first quarter where sales were 15 percent below last year. Our business remains strong, liquid and well positioned for growth with USD 285 million in cash and marketable securities up from USD 278 million on September 26, 2020. We do, however, anticipate that the virus will continue to have a negative impact on the foodservice industry in the short term.
Dan Fachner, J+J’s President, commented, «These are unprecedented times, and I’m so proud of our employees, and their commitment to this Company and serving our customers and consumers each and every day. Consumers continue to stay at home which has driven strong growth in our retail segment, but closures and limited capacity food service venues are challenging sales in other parts of our business. Our balance sheet is strong, and we will continue to focus on driving cost efficiencies across our operations. We continue to be optimistic and remain confident that we are well positioned for future growth.»